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The Christian Social Union (CSU), sister party of German Chancellor Angela Merkel's Christian Democrats (CDU), will elect a new leader at the party congress on Saturday to replace Stoiber, who also gives up his post as state premier in October.

Party leader since 1999 and premier for 14 years, Stoiber told Bavarians to be proud of their state and delegates cheered loudest when he homed in on Christian values.

"When the mosques in our cities are bigger than cathedrals and churches, then we must tell our Muslim fellow citizens: 'No, that is going too far.'

"Church towers, not minarets, should be what you see when you look out across the state," the 66-year-old said.

Stoiber, long an influential figure on Germany's right and a thorn in Merkel's side, was forced to quit early after a snooping scandal. The CSU has ruled predominantly Catholic Bavaria with an absolute majority for more than 45 years.

State Economy Minister Erwin Huber is tipped to be chosen as CSU leader on Saturday. Bavarian Interior Minister Guenther Beckstein is set to become state premier in October.

The new leader will have a voice in national policy and the changeover could affect Merkel's cabinet because one of the top candidates, Horst Seehofer, is German Consumer Affairs Minister.

Germany has the second-biggest Muslim population in western Europe. The CSU supports a more traditional approach than the CDU in social and family affairs and Stoiber stressed the importance of marriage.

Delegates expressed mixed feelings about their outgoing leader, viewed by some critics as dour and arrogant. He was given a cool reception when he entered the hall.

GOOD LIFE

"This is the end of an era," said delegate Richard Reinfeld. "He deserves praise for what he has done for Bavaria but it's time for him to go. I'm not sure how he hung on for so long."

In 2002, Stoiber came within about 6,000 votes of becoming chancellor and his role as head of one of Germany's biggest and richest states -- whose economy is bigger than 21 of the EU's 27 nations -- handed him power in the conservative camp.

Merkel is unlikely to miss Stoiber who has often criticised her policies and poisoned the atmosphere in her ruling coalition with the Social Democrats.

She made clear there had been differences in the past but made Stoiber blush by praising his achievements.

"Edmund Stoiber has done things in Bavaria which Germany can learn from," she said.

Stoiber's "laptop and lederhosen" policies to lure high-tech firms to the once rural state and his success in holding on to national corporate giants, including Siemens and BMW, have kept unemployment levels in Bavaria below the national average.

Stoiber was forced to quit early after glamorous party rebel Gabriele Pauli said his office was snooping on her private life.

For many, Friday's gathering was a social event. The beer started flowing long before the speeches began and many delegates, some in traditional costumes, were eager to get to a celebration marking Stoiber's 66th birthday.